Mexico surpassed Canada as the top U.S. trading partner in goods and services in 2024, and held that position through 2025 with $976.1 billion in total bilateral trade. That figure — approaching a trillion dollars — reflects a relationship that has been decades in the making and is now deeply wired into the structure of both economies. In goods alone, total U.S.-Mexico trade reached $872.8 billion in 2025, with the United States importing $534.

USMCA was supposed to lock in preferential market access between the United States, Mexico, and Canada. The current U.S. tariff posture is testing just how durable that framework is. As of February 24, 2026, U.S. imports from Mexico are subject to a 10% tariff imposed under Section 122 of the Trade Act of 1974, valid for up to 150 days. The measure includes a carve-out for goods that qualify under USMCA rules of origin — meaning products that meet the agreement’s domestic content requirements can avoid the levy — but that exception does not cover everything crossing the border.

When an automobile rolls off an assembly line in Michigan or Kentucky, it may carry thousands of components sourced from dozens of U.S. states and multiple Mexican locations. The final assembly badge — “Made in USA” or “Made in Mexico” — says almost nothing about the actual geography of production. This is the reality that the NAFTA era built, and that USMCA inherited. A significant portion of U.S.-Mexico merchandise trade is not conventional import-export commerce.

July 2026 marks a critical inflection point for North American trade. Under Article 34.7 of the United States-Mexico-Canada Agreement, the three signatories are required to meet on the sixth anniversary of the agreement’s entry into force to conduct a formal review and determine whether to extend USMCA’s operation. That deadline is now months away, and the political environment surrounding it is anything but settled. USMCA replaced NAFTA on July 1, 2020, preserving most of its predecessor’s architecture while updating key provisions.